Reno Sparks Real Estate Market Heats Up under $200,000

Reno/Sparks Real Estate - Buying Real Estate in Reno/Sparks, Nevada

Ask anyone shopping for a home in the sub-$200,000 range this month and they will tell you... the competition is fierce!

Multiple offers (as many as a dozen on day one), offer price far exceeding list price, half a dozen groups of prospective buyers all viewing a home at the same time - it has all become commonplace over the last few weeks. Why is this? Two factors are coming into play. First, the banks have been strategic in controlling inventory. We currently have less than 250 bank owned homes available in Reno/Sparks - that is almost half as many as earlier this year. Second, the $8000 First Time Home Buyers Tax Credit expires on December 1st (must close by November 30th). Most buyers and their agents are aware that there is no guarantee a Short Sale transaction will close by that time...therefore they are all going after the bank owned homes with ferocity.

It is hard for a buyer to come to the realization that they might need to offer more (much more) than asking price if they would like to purchase a home. They have been bombarded with reports for the last 12 months about how this is a Buyer's Market. It is still a great time to buy, prices and rates are very low historically and the tax credit is a big bonus, but buyers that want to close in time for the Tax Credit need to be quick and expect strong competing offers.

It remains to be seen how this flurry is going to effect the local market in the short term. We know inflated offer prices may prove problematic when it's time to get an appraisal. How many of these transactions are going to fall apart due to appraisal issues? We know appraisers are under lots of scrutiny these days. And with new "firewall" policies for appraisers - are they going to realize that many of the comparable pendings are in contract above list price?